trending Market Intelligence /marketintelligence/en/news-insights/trending/SWBxIbfNwe4nLexaeyaJ8Q2 content esgSubNav
In This List

International Hydropower Association releases new sustainability guidelines


Japan M&A By the Numbers: Q4 2023


See the Big Picture: Energy Transition in 2024


IR in Focus | Episode 10: Capital Markets Outlook


Infographic: The Big Picture 2024 – Energy Transition Outlook

International Hydropower Association releases new sustainability guidelines

The International Hydropower Association released new sustainability guidelines to define what it termed are good international practices in planning, development and operation of a hydropower projects.

The Hydropower Sustainability Guidelines on Good International Industry Practice was prepared as a reference document to meet the expectations of lenders, regulators and consumers, a press release from the IHA said.

Hydropower advocates hope the new standards will help project financing efforts, potentially allowing certain projects access to green bond markets. Organizations may choose to reference compliance with the guidelines in contractual arrangements, while lenders and investors may opt to reference the guidelines in their terms of agreement, according to the guidelines' stated purpose.

SNL Image

Hydro projects get sustainability guidelines.

Source: Thinkstock

The guidelines cover a range topics relevant to hydropower activities and are the latest iteration of a large group of stakeholders from hydropower companies, social and environmental organizations, financial institutions, governments and intergovernmental organizations. The first hydropower sustainability guidelines were published in 2004 and a Hydropower Sustainability Assessment Protocol was delivered in 2011.

"Use of the guidelines on good international industry practice will enable hydropower developers and operators across the world to step up to ensure their projects can meet the needs and expectations of the communities they serve," said Hydropower Sustainability Assessment Council Governance Committee Chair Roger Gill whose organization reviewed and approved the guidelines as a multi-stakeholder body.

The guidelines cover 26 topics and measures of performance, such as economic and financial viability, demonstrated need, benefits, affected communities, working conditions, environmental management and water quality. The 184-page document lays out the need for infrastructure safety, financial viability, safeguarding water quality and stakeholder engagement.

For example, the guidelines point out that one of the most basic reasons for social opposition to hydropower development is if a project appears to be developed primarily as a profit-making venture for a private developer. "The better a project proponent can communicate the demonstrated need for the project in terms of local, national, and regional water and energy services, the better the chances that the project can be supported by the communities that it affects," the guidelines advise.

Examples of sustainability considerations for siting and design include minimizing the area flooded per unit of energy produced, minimizing public health risks and population displacement and protecting wildlife habitats.

"Avoidance and minimization of social and environmental impacts through siting and design choices, based on sound environmental and social assessments, is far more cost-effective for a hydropower project than trying to manage and mitigate problems after they occur," the guidelines state.

With this in mind, the guidelines offer examples of design features such as fish ladders, channels and pipes for fish to be diverted around turbines, sediment control structures and planning of dam heights and reservoir levels.

Social and environmental issues must be coordinated with technical and financial considerations, the guidelines stress before conceding that "unfortunately, technical studies are often well-advanced before the environmental and social studies even begin."